Positive findings in review of SMEs' FY17/18 outlook

As the new financial year gets underway a significant proportion of SMEs have indicated that they plan to invest savings from the reduced company tax rate back into their business according to research from a software provider.

Tax&Compliance Lara Bullock05 July 2017

Last week MYOB released its latest SME Snapshot which revealed that 63 per cent of small business owners are positive about the decision to reduce company tax rates.

Interestingly, 44 per cent of businesses indicated that they plan to invest whatever savings come from reduced company tax rates back into their business.

Speaking to Accountants Daily, MYOB’s chief strategy officer, John Moss said that while the changes are small, SMEs are positive about what it can mean for them.

“It is a small change in a sense that small businesses have been extended from $2 million to $10 million and the tax rate will be dropping by 1 per cent so in absolute terms the percentage reduction in tax is quite small,” Mr Moss said.

“If you think about a business between $2 million and $10 million taxable income, the 1 per cent won’t make enough of a saving to start recruiting new staff or anything like that at this point in time, but over time it will.”